Gold Rise, Bitcoin Soar, Stocks Fall After Trump's Election Win – What's Behind the Chaos?
BTC initially decoupled from stocks, but the positive correlation has strengthened during the recent decline.
James Van Straten, Omkar Godbole | Edited by Omkar Godbole Updated Mar 20, 2025 15:53 UTC Published Mar 20, 2025 11:14 UTC
What you should know:
- Bitcoin has jumped 23% since Trump's election, at one point reaching an all-time high above $109,000, while Strategy (MSTR) shares remain strong, up 34%.
- European stock markets (DAX +20%, FTSE 100 +6%) outperform US ones (Nasdaq and S&P 500 down around 2%) as investors trim their exposure to US equities. Gold continues to rise, reaching $3,030 an ounce (+11%).
- The US dollar index (DXY) remains steady after a significant drop, helping to strengthen the euro and the British pound. Oil prices fell about 7% as the US emphasizes energy dominance.
Cryptocurrency proponent Donald Trump won the US presidential election more than four months ago, and since then financial markets have been in a volatile period, with global uncertainty surrounding tariffs, geopolitical tensions and ongoing conflicts in the Middle East and between Ukraine and Russia.
Bitcoin (BTC) has risen more than 23% since the November 5 election, reaching an all-time high of over $109,000 in late January. Despite a subsequent 30% decline from its peak, it remains one of the best-performing assets. Strategy (MSTR), often seen as a proxy for Bitcoin, has risen 34%, recovering significantly under the Trump administration after previously falling nearly 60% from its November highs.
Ethereum (ETH) token fell 18% amid disappointing performance in the broader crypto market. The Valkyrie Bitcoin Mining ETF also struggled, falling nearly 30%. Meanwhile, investors shifted funds to BTC, increasing its market share by 2% to more than 61%.
European stocks performed strongly, outperforming their US counterparts. Germany’s DAX rose 20% and the UK’s FTSE 100 gained 6%, while the US market performed weaker, with the Nasdaq and S&P 500 both down around 2%. A recent Bank of America report highlighted a record decline in US equity allocations. Gold, benefiting from the uncertainty, continued to set new all-time highs, rising 11% to above $3,030.
The US Dollar Index (DXY), which measures the greenback's strength against a basket of major currencies, has remained steady. However, the dollar has weakened significantly under Trump, giving some support to risk assets and major currencies such as the euro and sterling.
Meanwhile, the yield on 10-year U.S. Treasury notes fell slightly to 4.2%, a key metric closely watched by the administration. Oil prices fell about 7% as the U.S. continues to pursue its stance of energy dominance to reduce energy costs.
It's worth noting that some of the so-called “Magnificent Seven” stocks have struggled, with NVIDIA (NVDA) down 16% and Tesla (TSLA) down 6%.
